Lloyds Bank share offer closes Friday, 5 June

The Lloyds Bank share offer closes this Friday, 5 June, so shareholders need to act quickly if they are going to subscribe.

The shareholder offer is 0.6213 new ordinary Lloyds shares for every ordinary share held, at an offer price of 38.43p per new share.

So if, for example, you currently hold 500 Lloyds shares that were bought before the 20 May and qualify for the offer, you’re entitled to 310 shares at a cost of £119.

If you therefore take up the offer and make your payment you will profit by the difference in the current Lloyds share price (around 72p) and the purchase price, equating to just over £100.

Once the offer is closed, any shares that remain that have not been taken up by shareholders will be offered in the marketplace by Lloyds.

If you have not taken up the offer, Lloyds will then send you a cheque for the profit made on the difference between the price it achieved in the marketplace and the offer price.

In theory therefore you could receive money even if you don’t do anything.

However as Nick Raynor, investment advisor at The Share Centre, comments ‘Big institutions are not going to want to pay a lot for the shares, so shareholders waiting for the pay-out could be left disappointed. ‘

He added ‘Even those less convinced about the bank’s future should consider taking up the offer, as they stand to gain even if they buy and sell later in the week. This will also help to keep the government’s stake down and enable Lloyd’s to buy back £4bn of its current preference shares.’

According to the Share Centre, a third of their customers who have Lloyds shares have already opted in to the offer.

Even though shareholders have until Friday to subscribe, if you are considering taking up the offer, check the deadline by which you have to subscribe with your share service provider as this may be sooner.

Investors should of course make their own judgements on buying or selling shares and if in doubt seek independent financial advice.